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Weak euro hits Q2 AlpInvest results

Carlyle's investment solutions group, which includes fund of funds arm AlpInvest Partners, lost about $6bn in AUM due to currency changes.

The weakness of the euro against the US dollar resulted in lower management fees for The Carlyle Group‘s fund of funds arm AlpInvest Partners during the second quarter of this year.

Carlyle’s fee-earning assets under management (AUM) in its investment solutions business, which includes AlpInvest’s operations and Metropolitan Real Estate, dropped to about $30 billion from $39 billion during the last 12 months, according to the firm, which announced its Q2 earnings on Wednesday. About $6 billion of that fall was due to foreign exchange fluctuations, according to the firm.

“If you keep in mind, in the AlpInvest side of that business, they are euro-denominated funds,” Carlyle’s chief financial officer Curt Buser said in a conference call with analysts on Wednesday. “As the euro has moved, it had an adverse effect on the fee earnings AUM in that cycle, and you will see the same thing coming through in management fees in that segment.”

Despite this, Carlyle executives said the firm had a number of funds “ready to tee-up for fundraising”.

“AlpInvest, our large private equity fund of funds secondaries and co-investment arm within investment solutions continues to attract large commitments,” co-chief executive David Rubenstein said on the same call.

Carlyle reported $5.8 billion of realisations for the second quarter of 2015.

AlpInvest’s latest dedicated secondaries fund, AlpInvest Secondaries Fund V, closed on $750 million in 2013 after a year of fundraising, according to PEI’s Research and Analytics division.

The firm, which was bought by The Carlyle Group in 2011, has offices in Amsterdam, New York, Indianapolis and Hong Kong.